Lake Street initiated coverage of Profound Medical (NASDAQ:PROF; TSX:PRN) with a “buy” rating and $16.50 price target. The stock closed at $10.19 on July 22.
Analyst Ben Haynor writes that with reimbursement of TULSA CPT Category 1 codes beginning January 1 and Level 1 clinical trial initial data expected In H1 2025, Profound’s TULSA-PRO is ready for thrust into the prostate cancer market.
The TULSA procedure has the potential of becoming a mainstream treatment modality across the entire prostate disease spectrum; ranging from low-, intermediate-, or high-risk prostate cancer (PCa); to hybrid patients suffering from both PCa and benign prostatic hyperplasia (BPH); to men with BPH only; and also, to patients requiring salvage therapy for radio-recurrent localized PCa. TULSA employs real-time MR guidance for pixel-by-pixel precision to preserve prostate disease patients’ urinary continence and sexual function while killing the targeted prostate tissue via a precise sound absorption technology that gently heats it to kill temperature (55-57°C). TULSA is an incision- and radiation-free “one-and-done” procedure performed in a single session that takes a few hours. Virtually all prostate shapes and sizes can be safely, effectively, and efficiently treated with TULSA. There is no bleeding associated with the procedure; no hospital stay is required; and most TULSA patients report quick recovery to their normal routine.
“Our substantial, proprietary survey work suggests men would fully embrace a new prostate cancer treatment option without the significant side effects associated with existing options,” Mr. Haynor said. “Given drawbacks of current PCa treatments, CMS reimbursement mere months away, CAPTAIN trial data soon thereafter, and unenviable competitor positions, we anticipate TULSA-PRO will emerge a true challenger to the PCa standard of care throne,” he added.
While Mr. Haynor’s initiation report focussed on Profound’s prostate cancer opportunity, he said that Lake Street planned to detail the company’s BPH opportunity in a future report. “Credible estimates from the likes of PROCEPT Biorobotics (NASDAQ:PRCT) suggest ~290K of the ~400K BPH surgeries that occur in the U.S. each year are resective procedures. TULSA-PRO is an option for these procedures, and at ~$8K revenue per procedure would represent a multi-billion addressable market for Profound,” he said.
